Strategy Inc. MSTR executive chairman Michael Saylor cautioned companies against leveraging Ethereum ETH/USD and Solana SOL/USD like Bitcoin BTC/USD, stating that it might lead to a “catastrophe.”

What Happened: In an interview with TheBlock that aired Saturday, Saylor likened Bitcoin to steel while comparing Ethereum and Solana to balsa wood and clay bricks. He warned that leveraging these tokens could lead to them buckling under pressure.

The Bitcoin maximalist said that Ethereum and Solana were not commodities but rather tokens. “And so I would caution anybody listening here against leveraging up on a token or a proprietary asset,” he added.

“The reason it works is because I’m putting leverage on steel (Bitcoin). I’m doing it with the right material. I’m actually using a product which doesn’t deflect. Bitcoin is a crypto asset which does not deflect,” Saylor said.

To the contrary, doing the same thing with FTX Token FTT/USD or Terra Classic LUNC/USD or picking one’s favorite token could lead to “catastrophe,” he argued, citing the two implosions that rocked the cryptocurrency market in 2022.

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Why It Matters:  Saylor’s cautionary advice comes at a time when companies are increasingly exploring cryptocurrencies other than Bitcoin as investment tools.

Upexi Inc. UPXI announced raising approximately $100 million through securities purchase agreements Monday to expand its cryptocurrency ventures, including building a Solana treasury.

Before this, BioNexus Gene Lab Corp. BGLC announced Ethereum’s adoption as a treasury reserve asset last month, claiming to be the first company on NASDAQ to do so.

Saylor’s Strategy, on the other hand, has been razor-focused on Bitcoin, having built a stockpile of 534,741 BTCs, worth $47.19 billion, according to  bitcointreasuries.com.

Price Action:  At the time of writing, Bitcoin was exchanging hands at $88,226.94, up 1.13% in the last 24 hours, according to data from Benzinga Pro. 

Shares of Strategy were up 0.23% in after-hours trading after closing 0.18% higher at $317.76 during Monday’s regular session. 

MSTR demonstrated a very high momentum score—a measure of the stock's relative strength based on its price movement patterns and volatility over multiple timeframes—as of this writing. To find out similar high-momentum stocks,  go to Benzinga Edge Stock Rankings.

Photo Courtesy: alfernec on Shutterstock.com

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.